St. Joseph Medical Center board recommends buyer

St. Joseph Medical Centertook another step in choosing a buyer for its Towson campus.

The hospital said the board made a recommendation Monday to the parent company, Catholic Health Initiatives, which has the final say.

Officials declined to identify the board's choice. But the three finalists were LifeBridge Health, which owns Sinai and Northwest hospitals; Ascension Health, which owns St. Agnes Hospital; and the University of Maryland Medical System.

St. Agnes is the only Catholic hospital among the bidders, but St. Joseph's said all three systems agreed to honor its "Catholic identity and religious heritage."

St. Jospeh officials say there is no timetable for Catholic Health's Board of Stewardship Trustees to choose a buyer. The Catholic Health board does not have to abide by the recommendation.

"The decision follows a year-long evaluation of strategic alternatives and discussions in recent months with Catholic and other not-for-profit health care organizations that expressed interest in St. Joseph," the hospital said in a statement about the sale. "As health care reform continues to evolve, it will be critical for health providers to be part of a regional network of coordinated health care organizations including hospitals, physicians, payers and other related health entities in geographically proximate areas."

The hospital said Catholic Health, as well as federal, state and church authorities, will have to approve the next owner.

CardinalEdwin F. O'Brienargued in a commentary that ran in The Baltimore Sun in January that St. Joseph's should be bought by another Catholic institution.

"The foundation that led to St. Joseph's modest beginnings and decades of growth is the same one that must see it through this difficult time in its storied and illustrious history," O'Brien wrote. "It is a foundation rooted in the Franciscan tradition and its Catholic identity."

O'Brien must approve any Catholic hospital merger within the archdiocese, but he has not said whether he would shoot down a merger with a non-Catholic hospital. O'Brien is apostolic administrator of the Arcdiocese of Baltimore until the May 16 installation of Bishop William E. Lori as archbishop.

Such intervention is rare but the Vatican has stepped in to stop hospital mergers in other parts of the country.

St. Joseph sought bidders as it coped with complaints that its star cardiologist,Dr. Mark Midei, had performed hundreds of unnecessary medical procedures. The hospital notified about 600 patients in 2009 that stents had been placed in their arteries that they might not have needed.

The fallout at the hospital included losses of revenue, patient admissions and doctors and other staff. Recently the hospital laid off 17 people. And the hospital and its parent company face millions of dollars in lawsuits from many of the former patients.

Midei was forced to resign from the hospital and the Maryland Board of Physicians revoked his license in the state. He is fighting that decision.

The hospital also agreed to increased federal oversight after federal accusations of a kickback scheme that resulted in a $22 million settlement and repayment of funds for questionable procedures.

The hospital admitted no wrongdoing under the agreement. It signed a multiyear "corporate integrity agreement" with theU.S. Department of Health and Human Services, it said, to "ensure that all conduct and activity going forward is in compliance with all regulations governing health care."